The Tech Industry Background
The tech industry is increasingly becoming one of the most successful industries in the U.S. The industry traces its origin back to 1904, following the “invention of the two-element electronic tube” (globalEDGE, n.d., para. 1). However, it was not until the 1950s that the industry experienced tremendous growth, instigated by the development of the transistor and analog devices (globalEDGE, n.d.).
Today, the tech industry comprises multiple companies specializing in a wide range of services and goods. The composition of the tech industry is quite unique due to technological changes and innovations. Consequently, the players end up investing more in research and development. This explains why the workforce comprises mainly “engineers and other highly-skilled technical workers, relative to other industries, especially since product creation requires creativity, expertise, and precision” (globalEDGE, n.d.). The industry also has a large workforce that specializes in sales and promotion because its success and growth depend on the consumers of the products.
Problem Background
The tech industry relies heavily on highly skilled technical workers to produce products that meet customer needs. However, the industry is currently crippled by the challenge of getting competent staff, especially since technology is evolving daily. McGuinness et al. (2021) describe the modern tendencies of skill-displacing technological change (SDT), which poses a problem of rapid obsolescence of existing skills in experienced workers and increasing inequalities in professional advancement. In fact, the skill gap is on the rise within the industry, which explains why it is currently struggling with undertaking most of its I.T. functions.
Literature Review
Industry
Most companies in the tech industry are small because they specialize in a specific product. Gupta (2022) claims that technological changes and innovations have a huge influence on society, being the reason for a thorough regulation of the industry through a government or regulatory bodies. However, these small companies, once they develop a unique product, end up being bought by large revenue earners in the industry.
It is important to note that most of the companies in this industry are either hardware or software producers. A good example of companies in the hardware sector includes Hitachi and Hewlett-Packard. On the other hand, Microsoft Corp, IBM, and Google are the common software companies within the tech industry.
However, these and many other software producers are threatened by the challenges of the upcoming Industry 5.0, focusing on the integration of A.I., cloud technologies, and other innovations and associated digital incompetence (Paschek et al., 2019). Moreover, it is most probable that the management will be in arrears of technical specifics of software development, which also creates obstacles to harmonizing managements’ and developers’ efforts (Paschek et al., 2019). Therefore, the tech industry has come to the point where all connected domains, including management improvement, need addressing.
The Scarcity of Skilled Workforce
The scarcity of skilled workforce in the tech industry is not only limited to developers, engineers, and data scientists but also in areas such as computing infrastructure and security. As observed by Kerr (2020) in their study, hiring a skilled workforce, especially from other countries, requires additional costs beyond the conventional expenditures for hiring a new employee, which contributes to the lack of suitable candidates. This shortage, in the end, hinders innovation capabilities, thus reducing productivity gains. Although technological advancements have had a positive impact on the U.S. tech market, they have also widened the tech talent divide. This gap continues to widen due to the recent adoption of machine learning technologies.
Global Shortage and Statistics
There are more technology jobs in the United States than in the current workforce. As explicated by Fry et al. (2021), although 19 million workers were employed in science, technology, engineering, and math (STEM) occupations in the U.S. in 2019, the discussed tendencies suggest a possible shortage in the future. In a different study by Brunello and Wruuck (2019), the authors noted that almost half of the tech industry companies continue to encounter difficulties when it comes to “recruiting graduates with suitable skills” (p. 8).
On the other hand, Hamada (2019) offers companies the opportunity to solve the expert shortage through outsourcing or in-firm training. However, as has been mentioned, these practices are always associated with additional expenditures, making the firms contemplate retaining skilled employees rather than altering the workforce.
The industry is also experiencing a high shortage of engineers and developers. According to William (2023), the shortage of engineers in the U.S. is expected to reach 1.2 million by the year 2026 (para. 16). This scarcity of engineers is the main reason why there is an increase in software developer pay. The findings by the U.S. Bureau of Labor Statistics noted that the need for software developers is bound to increase by 22 percent (William, 2023, para. 17). This is a clear indication that the industry is in dire need of a highly qualified workforce in meeting the needs of the consumers.
Discussion of Findings
It is clear from the literature review that the tech industry has been experiencing a high shortage of skilled labor. This shortage cuts across the industry’s workforce, from developers to engineers, computing infrastructure, and security personnel. The problem is not only being experienced within the U.S. but also around the world.
One of the central reasons for this phenomenon is a gap in professional advancement. However, the costs and expenditures associated with outsourcing or developing programs for in-company training play the most critical role, as many organizations have limited financial resources for major workforce changes.
An overriding point from the literature is that the tech industry depends more on a highly skilled workforce in order to meet all the requirements of the innovation process. Based on my personal experience working in this industry, it is accurate to say that the industry is constantly looking for qualified graduates to fill an ever-growing vacancy in sales and promotion.
Managerial Recommendation
The managerial recommendation in an effort to resolve the issue of the scarcity of skilled workers is to create a culture of learning and encourage ongoing training. First, the industry should direct its resources toward training managers to mentor and encourage workers to share skills with one another.
Management should also create an environment where employees are motivated to become better versions of themselves. In addition to this, the industry should strive to provide an engaging learning experience through informal team-building training and training workshops. Ongoing training, on the other hand, will ensure the staff remain informed and confident in performing roles.
Next Steps
The roadmap for implementing the recommended solution will require the direct involvement of the industry’s managers and the top leadership. They will be required to review their company’s learning strategy to identify gaps and weaknesses. Similarly, managers and leaders must strive to make learning a core organizational value. The table below provides an overview and timeline of some of the activities to implement the aforementioned recommendation.
Table 1 – Implementation of Managerial Recommendations.
References
Brunello, G., & Wruuck, P. (2019). Skill shortages and skill mismatch in Europe: A review of the Literature, 6(1), 40-90. Web.
Fry, R., Kennedy, B., & Funk, C. (2021). STEM jobs see uneven progress in increasing gender, racial and ethnic diversity. Pew Research Center, 1-28.
Gupta, S. (2022). The interaction between technology, business environment, society, and regulation in ICT industries. Indian Institute of Management Bangalore Management Review, 34(2), 103-115. Web.
globalEDGE. (n.d.). Technology, globalEDGE: Your source for global business knowledge. Web.
Hamada, T. (2019). Determinants of decision-makers’ attitudes toward Industry 4.0 adaptation. Social Sciences, 8(5), 140-158. Web.
Kerr, W. R. (2020). The gift of global talent: Innovation policy and the economy. Innovation Policy and the Economy, 20(1), 1-37. Web.
McGuinness, S., Pouliakas, K., & Redmond, P. (2021). Skills-displacing technological change and its impact on jobs: challenging technological alarmism?. Economics of Innovation and New Technology, 1-23. Web.
Paschek, D., Mocan, A., & Draghici, A. (2019). Industry 5.0—The expected impact of next industrial revolution. Thriving on future education, industry, business, and Society, Proceedings of the MakeLearn and TIIM International Conference. Web.
William, E. (2023). Supply vs. demand of software developers and engineers: The economics of the tech talent shortage in 2022. Hire remote developers. Build teams in 24 hours. Web.